UpdateTransocean to pay $400m fine, gets probation for oil spill

14 February 2013 22:24  [Source: ICIS news]

HOUSTON (ICIS)--A US judge ordered offshore drilling company Transocean to pay $400m (€296m) in fines and sentenced it to five years of probation for criminal charges related to the 2010 Deepwater Horizon explosion and oil spill, the Department of Justice (DOJ) said on Thursday.

Transocean had agreed on 3 January to a $1.4bn settlement to plead guilty to a violation of the Clean Water Act for its conduct leading to the disaster that killed 11 people. The $1bn civil settlement is pending before another judge.

“Transocean’s guilty plea and sentencing are the latest steps in the department’s ongoing efforts to seek justice on behalf of the victims of the Deepwater Horizon disaster,” said US Attorney General Eric Holder. “Most of the $400m criminal recovery – one of the largest for an environmental crime in US history – will go toward protecting, restoring and rebuilding the Gulf Coast region.”

Transocean declined to comment on the judge’s decision.

On 3 January, the company said on its website: “These important agreements, which the company believes to be in the best interest of its shareholders and employees, remove much of the uncertainty associated with the accident. This is a positive step forward, but it is also a time to reflect on the 11 men who lost their lives aboard the Deepwater Horizon. Their families continue to be in the thoughts and prayers of all of us at Transocean.”

By pleading guilty, Transocean admitted that its crew onboard the Deepwater Horizon were negligent in failing to fully investigate clear indications that the Macondo well was not secure and that oil was flowing from the well, the DOJ said.

Under the criminal resolution, $150m will be directed to the National Academy of Sciences (NAS) for oil spill prevention and response in the Gulf of Mexico.

Another $150m will go to the National Fish and Wildlife Foundation (NFWF).

“These funds, along with money from the recent BP settlement, will go a long way toward helping protect and preserve the natural resources of the Gulf Coast that suffered from the spill,” said Jeff Trandahl, executive director and CEO of the National Fish and Wildlife Foundation. “We intend to make sure the money is used effectively, efficiently and transparently.”

Transocean will continue to cooperate with the government’s criminal investigation, and its subsidiaries must implement court-enforceable measures to improve operational safety and emergency response capabilities at all of their drilling rigs, the DOJ added.

In connection with the Deepwater Horizon disaster, UK oil giant BP will pay $4bn to settle federal criminal charges and an additional $525m to settle claims made by the Securities and Exchange Commission (SEC).

Separately, BP reached an economic- and property-damage settlement agreement with several people and businesses who sued the company following the spill.

In addition, three of BP’s managers and a former engineer also face criminal charges.

($1 = €0.74)

By: Tracy Dang
+1 713 525 2653

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